Question about backups with Ghost

Question for the experts.....

I have never used Ghost before so here is my setup.

Win xp sp2 with two internal sata drives each in a removeable drawer.

System drive is C

Storage drive is D

What I'd love to be able to do is the following:

Back up Drive C to Drive D so that if something gets screwed up i can simply
remove Drive C and then the "D" drive would become an exact replacement
which would pick up where "C" left off.

Is this possible?

Can I do Incremental backups nightly which would only backup files and
folders which have changed without copying the entire contents?

If thiis is indeed possible....how can a backup drive which is a clone of
the original boot at the same time as the system drive, how does windows
know the difference?

TIA

jeff